Social Networks and Job Access for the Unemployed: Work Ties for the Upper-Middle Class, Communal Ties for the Working Class

Abstract

In Europe, almost half of all jobs are found through personal contacts such as colleagues, family, or friends. We analyse whether personal contacts facilitate access to jobs for the middle or the working class. We do not treat informal ties as a homogeneous category, but distinguish work-related contacts from communal contacts such as family, friends, and acquaintances. Our analysis is based on a longitudinal survey of unemployed jobseekers in Switzerland that we match with administrative data. We find that work-related ties are disproportionately used by individuals with favourable employment prospects: middle-aged jobseekers with high prior earnings. In contrast, communal contacts chiefly help jobseekers with poor employability, notably the low-skilled working class and workers dismissed for non-economic reasons. Communal contacts thus compensate for the difficulty of finding a job through other channels. However, the different search methods do not affect how wages evolve from pre- to post-unemployment jobs. The unemployed who found a job via communal ties were earning less than those using a work tie or a formal method to begin with.